Member Briefing July 22, 2025
Inflation Eats Into Real Earnings Growth For Employees
Although earnings growth for frontline employees is still outpacing growth for all employees, inflation is eroding real wage gains for both groups, with average hourly earnings for production employees up 3.9% before inflation-adjustment in June. Furthermore, risks to higher inflation could wipe out real wage gains in the future. Real average hourly earnings decreased 0.1% from May to June as a result of a 0.2% rise in average hourly earnings combined with a 0.3% gain in inflation. In the past year, real average hourly earnings grew 1.0%, while the average workweek decreased 0.3%, resulting in a 0.7% increase in real average weekly earnings compared to the prior year.
For production and nonsupervisory employees, real average hourly earnings stayed the same in June as a result of a 0.3% rise in average hourly earnings and a 0.3% increase in inflation. Real average weekly earnings for this group edged down 0.6% over the month due to the change in hourly earnings and a 0.6% decrease in the average workweek. In the past year, real average hourly earnings for this group advanced 1.3%, and the average workweek shortened 0.6%, resulting in a 0.7% increase in real average weekly earnings over the year.
The U.S. Economy Is Regaining Its Swagger
When President Trump slapped tariffs on nations across the globe this spring, many economists feared higher prices and spending cuts would flatten the economy. Consumer sentiment collapsed. The S&P 500 stock index fell by 19% between February and April. The world held its breath and waited for the bottom to drop out. But that didn’t happen. Now businesses and consumers are regaining their swagger, and evidence is mounting that those who held back are starting to splurge again.
The stock market is reaching record highs. The University of Michigan’s consumer sentiment index, which tumbled in April to its lowest reading in almost three years, has begun climbing again. Retail sales are up more than economists had forecast, and sky-high inflation hasn’t materialized—at least not yet. There are still signs of turbulence in the U.S. economy. Growth has been subdued. Inflation, while down from pandemic peaks, is still higher than the Federal Reserve would like. Manufacturing activity shrank for the fourth straight month in June, and immigration raids are damping spending among Hispanic consumers. Still, companies and consumers have brightened their outlook from earlier this year.
Hackers Exploit Microsoft Software Vulnerability To Reportedly Target Governments And Businesses—What To Know
A vulnerability in Microsoft’s SharePoint server software was exploited by hackers to carry out “active attacks” globally on various entities, including businesses and U.S. federal agencies, prompting the software giant to issue an emergency patch. Microsoft said it has released a security update for SharePoint Subscription Edition and SharePoint 2019 users to “mitigate active attacks” targeting servers running the software. The company noted that the vulnerability only impacts companies using Microsoft’s software to host their own servers, and customers relying on Microsoft’s 365 cloud services have not been affected.
Citing government officials and security researchers, the Washington Post reported that the vulnerability affected U.S. federal and state agencies, universities and various businesses. The Post’s report added that the servers of at least two U.S. federal agencies were breached using this vulnerability. In a statement on Sunday night, the Cybersecurity and Infrastructure Security Agency (CISA) said it was “aware of active exploitation of a new…vulnerability enabling unauthorized access to on-premise SharePoint servers.” The federal agency said the vulnerability allowed malicious actors to “access file systems and internal configurations, and execute code over the network.”
Global Headlines
Middle East
- Israel Sends Tanks Into Gaza's Deir Al-Balah, Raising Concerns Among Hostages' Families - Reuters
- Iran to Hold Nuclear Talks With European Governments - NYT
- Ahead Of New Talks, Iran Blames Europeans For Nuclear Deal Collapse – France 24
- US Warns Over Another Middle East War in Syria - Newsweek
- Why Israel’s Chaotic New Food Program in Gaza Has Turned So Deadly - WSJ
- Syrian Authorities Evacuate Bedouin Families From Druze-Majority Sweida City – France 24
- Interactive Map- Israel’s Operation In Gaza – Institute For The Study Of War
- Map – Conflicts in the Middle East – Live Universal Awareness Map
Ukraine
- Ukraine's Zelenskiy Says New Peace Talks In Turkey On Wednesday - Reuters
- EU Lowers Russia Oil Cap And Imposes New Sanctions After Fico Drops Veto – Politico
- EU’s New Oil Price Cap To Hit Russia, But Analyst Says U.S. Could Be The Real ‘Game-Changer’ – CNBC
- Video Shows Inside Russia's Iranian Drone Factory - Newsweek
- Russian Attacks On Ukraine Kill Two, Cause Widespread Damage - Reuters
- Russia Will Soon Fire 2,000 Drones a Day: ISW - Newsweek
- Pro-Putin Conductor Canceled By Italy After Backlash - Politico
- Interactive Map: Assessed Control Of Terrain In Ukraine – Institute For The Study Of War
- Map – Tracking Russia’s Invasion Of Ukraine – Live Universal Awareness Map
Other Headlines
- Japan Ruling Coalition Routed By Upstarts: Key Election Takeaways – Nikkei Asia
- Japan PM Ishiba Vows To Stay On After Bruising Election Defeat - Reuters
- Warsaw Gloats, Berlin Balks As EU Budget Fight Turns National – Politico
- China Confirms Exit Ban on Wells Fargo Banker - WSJ
- Tensions Rise As Lula Blasts US Over Visa Sanctions Tied To Bolsonaro Trial - Reuters
- Companies Pledge To Invest More Than $700 Billion In Germany Over The Next 3 Years - Yahoo
- Musk’s X Refuses To Hand Over Data In ‘Politically Motivated’ French Investigation - CNBC
- Chinese Navy Shadowed French Aircraft Carrier: Report – Newsweek
Policy and Politics
Republicans Fear Washington Headed For Shutdown After Bruising Spending Fights
Republican lawmakers fear Washington may be headed for a government shutdown later this year after two bruising fights over President Trump’s One Big, Beautiful Bill Act and a $9 billion rescissions package has created bad blood on Capitol Hill. White House budget director Russell Vought says the administration plans to send up another wave of spending rescissions to Congress and GOP leaders are already waving the caution flag on that as some Republicans privately warn it may not have the votes to pass.
After six months of bitter partisan fighting since Trump’s inauguration, Republicans will now need cooperation from Democrats to keep the government funded and Senate Democratic Leader Chuck Schumer (N.Y.) is warning GOP colleagues not to expect “business as usual.” One senior Republican on the Senate Appropriations Committee put the chances of a shutdown in the fall at “a real square 50-50.”
New Alert System Unveiled To Prevent Summer Power Outages In N.Y.
As triple-digit heat intensifies across the state, New York’s power grid is working harder than ever to meet soaring demand. The New York Independent System Operator, or NYISO, has introduced a new alert system to keep the public informed — and the lights on. The NYISO recently debuted a four-stage public alert system. It shows real-time grid conditions online and encourages New Yorkers to conserve energy when reserves are low.
“During the heatwave a couple weeks ago, we found ourselves in that situation, and we activated the alert system for the first time,” said NYISO President and CEO Rich Dewey. “It enabled us to push information out to the public.” The system operates on four tiers: normal, energy watch, energy warning and energy emergency. When conditions turn critical, NYISO pushes updates through its website and social media.
Bipartisan ARMS Act Aims to Expedite Defense Capability Delivery to Allies
Reps. Robert Aderholt, R-Ala., Jared Moskowitz, D-Fla., Jimmy Panetta, D-Calif., and Ryan Zinke, R-Mont., introduced new legislation intended to fast-track the delivery of U.S.-manufactured defense capabilities to allies and partners. Aderholt’s office said Thursday the Accelerate Revenue for Manufacturing and Sales, or ARMS, Act aims to enhance the Special Defense Acquisition Fund and fix inefficiencies and delays within the Foreign Military Sales process.
Aderholt’s office said last week the ARMS, Act aims to enhance the Special Defense Acquisition Fund and fix inefficiencies and delays within the Foreign Military Sales process. The bipartisan proposal arises from a growing disparity in defense procurement, as the total value of FMS and Direct Commercial Sales has surpassed domestic defense procurement budgets in recent years. The imbalance is driven by an international demand for U.S. defense products that is nearly double that of domestic acquisition. “The ARMS Act is a win-win for our economic and national security, investing in both our critical manufacturing here at home and our allies’ defense abroad,” stated Moskowitz.
Political Headlines
- Treasury Secretary Bessent Calls For A Review Of ‘The Entire’ Federal Reserve – CNBC
- Texas Republicans Aim To Redraw House Districts At Trump’s Urging, But There’s A Risk - AP
- Harvard, Trump Administration Clash in Key Court Hearing - WSJ
- More Than 150 N.Y. Schools Have Submitted Plans For Bell-To-Bell Cellphone Ban
- Democrats Wrestle With Shutdown Strategy - Politico
- Jeffries Warns GOP: Partisan Spending Bills Risk An Oct. 1 Shutdown – The Hill
- DNC raises $8.6M in June, trailing RNC’s $16.2 – The Hill
- California Sues Trump To Hang Onto $4 Billion Of Bullet Train Funds - Forbes
- Trump Tracker: Keep Tabs On The Latest Announcements And Executive Orders - WSJ
Health and Wellness
Older Workers and the Mental Health Gaps Employers Can’t Afford To Ignore
Too often, mental health strategies overlook the people quietly carrying layered responsibilities outside of work: caregivers, older employees, and women navigating pivotal life and health transitions. These groups aren’t niche. They make up a large share of the workforce, and their needs are shaping the future of employee well-being. Workers aged 55 and older now comprise over 20% of the U.S. labor force, yet they remain an afterthought in many workplace mental health programs. While older workers may report better self-rated mental health than their younger peers, they’re also more likely to be navigating chronic pain, grief, or caregiving, and less likely to use digital tools that could help.
Unfortunately, usage of workplace mental health resources among older workers remains low. Importantly, the issue isn’t unwillingness: Over 80% of workers overall said they would be open to using digital tools if offered, provided those tools are trustworthy, simple, and relevant. However, just 23% are actually aware they are offered this kind of tool. To truly support older employees, employers must design for inclusion. That could mean creating low barriers to entry for support or framing support in ways that resonate with goals like independence and longevity. These small changes can boost digital engagement, reduce absenteeism, and help retain some of an organization’s most experienced talent.
Industry News
Trade Wars
- U.S. Plays Hardball On Tariffs Deadline As EU Battles For A Deal – CNBC
- Commerce Secretary Lutnick Warned That The Deadline For A Baseline 30% Tariff Is Fixed - WSJ
- Lutnick: US ‘Going To Love The Deals That President Trump And I Are Doing’ – The Hill
- EU readies its reprisals as Trump pushes for higher tariffs – Yahoo Finance
- Bessent: Imposing Aug. 1 Tariffs ‘Will Put More Pressure’ On Trade Partners For Deals - CNBC
- Less Selection, Higher Prices: How Tariffs Are Shaping The Holiday Shopping Season - AP
- After Pledging to Keep Prices Low, Amazon Hiked Them on Hundreds of Essentials - WSJ
- US Preps 93.5% Tariff On Graphite From China – Supply Chain Dive
- Inside A US Guitar String Maker's Strategy To Navigate The Trade War - Reuters
- Hiding in Plain Sight Spotting the Impact of Tariffs on the Consumer – Wells Fargo
onsemi to Establish Research Center for Wide Bandgap Materials at Stony Brook University
onsemi last week announced plans to invest $8 million dollars with Stony Brook University to establish a wide band gap research center that will advance innovation in power semiconductors and foster the next generation of skilled professionals in this field. The investment is part of a broader $20 million strategic collaboration with Stony Brook University and Empire State Development aimed at positioning New York as a national hub for power semiconductor innovation.
The center aims to advance foundational research in silicon carbide and other wide band gap materials and device-enabling technologies—capabilities critical to improving energy efficiency in AI and electrification. Expected to be fully operational in early 2027, the facility will feature specialized laboratories and advanced instrumentation for materials development, device integration, and performance characterization. As part of the collaboration, Stony Brook University is developing a curriculum for an undergraduate minor and a graduate master’s degree and certificate in silicon carbide and wide bandgap semiconductors.
Boeing Wins $7B Gulf Air Dreamliner Order
Boeing has landed a reported $7-billion contract from Bahrain-based Gulf Air for 12 widebody 787 Dreamliners, an order that includes options for six more aircraft. The jet builder did not indicate the delivery dates for new jets. In addition to the value of the order, for Boeing it also serves as a statement of confidence in the 787 program following the crash of an Air India 787 in June that killed 241 passengers and crew members.
Boeing reports that the 787 has established 425 nonstop routes since it was introduced in 2011, and has carried more than 1 billion passengers worldwide. Gulf Air is a long-time Boeing operator that currently has 10 787-9 Dreamliners in service and a total of 14 more on order. The carrier reportedly aims to modernize its jet fleet and expand its network of global destinations. "The Boeing 787 Dreamliner has proven to be an exceptional aircraft for our long-haul operations, and this new order reflects our confidence in its performance, passenger appeal and contribution to our sustainability goals,” stated Khalid Taqi, chairman of Gulf Air Group.
Read more at American Machinist
Battery Makers in Slumping EV Business Find Lifeline Elsewhere
Big U.S. EV battery makers are stepping back from the market that got them started and betting on a new set of customers in an entirely different business. Instead of carmakers, these companies have started making batteries for utilities, wind- and solar-power developers, and massive data centers that train artificial intelligence.
Five years ago, automakers and battery companies raced to build multibillion-dollar electric-vehicle battery plants across the U.S. South and Midwest, based on EV forecasts that proved too optimistic. Now, many of these plants are underused, delayed or stuck in limbo. Energy storage has emerged as an alternative, helping to compensate for the slowdown in electric vehicles. Tesla, for example, generates billions of sales from batteries for energy storage. Revenue from the storage segment, which also includes solar panels, grew 67% last year to $4 billion, partially offsetting a $6 billion fall in revenue from EV sales.
Stellantis Expects $2.7 Billion First Half Loss As Restructuring Costs, Us Tariffs Bite
Stellantis reported a preliminary 2.3 billion euro ($2.7 billion) first-half loss as it faces the dual challenge of revamping its product ranges in Europe and the United States while also dealing with the impact of U.S. tariffs on vehicles and auto parts. Stellantis said on Monday it booked 3.3 billion euros in pre-tax charges for the first half as it cancelled programmes, including a hydrogen fuel cell project, kept setting aside money for fines linked to U.S. pre-Trump carbon emission regulation, while investing more in popular hybrid cars in Europe and large gasoline-powered models in the U.S. market.
Stellantis' loss, versus a 5.6 billion euro net profit a year earlier, underscores the tough challenges for new CEO Antonio Filosa, who was appointed in May after a disastrous performance in the company's crucial U.S. market in 2024 forced the ouster of former boss Carlos Tavares. Last year, Stellantis imported over 40% of the 1.2 million vehicles it sold in the United States, mostly from Mexico and Canada. In April this year, the company said it had reduced vehicle imports in response to tariffs and would calibrate "production and employment to reduce impacts on profitability".
More Americans Shift Money From Checking And Savings To Accounts With Investment Income, Study Says
New research finds that more Americans are shifting their money from checking and savings accounts into financial vehicles that pay an investment income — a trend that helps to explain the resilience of the U.S. economy after a bout of high inflation and recent uncertainty due to tariffs. The analysis by JPMorganChase Institute examined the accounts of 4.7 million households and found that people's total cash reserves are increasing when including new amounts going into brokerage accounts, money market funds and certificates of deposit to assess people's well-being.
Inflation-adjusted cash balances in checking and savings accounts “remain low with a flat-growth trajectory,” but since the middle of 2024 total cash reserves have been increasing and approaching historical growth trends once the additional accounts are included, the analysis said. The analysis also found that households with incomes generally lower than $35,000 had their total cash balances increase at an annual rate of 5% to 6%. The lowest income quartile tend to have checking and savings account balance of just over $1,000, while the median balances of the highest income quartile are above $8,000.
Cleveland-Cliffs Looks To Sell Idle Steel Plants To Data Center Developers
Steelmaker Cleveland-Cliffs is looking to sell its idle mills and certain assets to potential buyers, including data center developers, in an effort to reduce its overall debt and rightsize operations, EVP and CFO Celso Goncalves said in an earnings call Monday. Cleveland-Cliffs, one of the largest producers of flat-rolled steel, has been in downsizing mode in response to weak automotive production and rising prices. Between March and May, it fully or partially idled six facilities, resulting in layoffs affecting 2,000 workers across Michigan, Illinois, Minnesota and Pennsylvania.
The company is in talks with advisor JPMorgan, exploring the potential sale of certain “non-core” operating assets worth billions of dollars, Goncalves said. It is also hearing from buyers interested in its recently idled mills in Riverdale, Illinois, as well as Steelton and Conshohocken, Pennsylvania. “These sites…are all uniquely positioned geographically and have what data center developers are looking for — access to power and water with the infrastructure already in place,” Goncalves said. If any of the sales are successful, he said the proceeds will go toward debt reduction.
Read more at Manufacturing Dive
Caterpillar Chases Sustainability with Efficiency
At the 2025 Consumer Electronics Show in January, Caterpillar exhibited a demonstration 972 XE front-end loader retrofit with a hybrid powertrain. At construction machinery and mining trade fair bauma 2025, held this April in Munich, Caterpillar further showcased its “The Next 100 Years” campaign promoting sustainability efforts by displaying industrial engines compatible with hydrotreated vegetable oils (HVOs).
Ditching fossil fuels and the pollution they belch into the air may sound more important in the long term for sustainability, but adopting HVOs might be a fantasy in the long run. Hybridizing engines, on the other hand, while much less sexy tech-wise, provides real benefits here and now. But Rob Hoenes, head of the electrification and energy solutions division at Caterpillar, says neither example is as important as increasing the efficiency of the engines that burn whatever sort of fuel we pump into their tanks.
Pepsi Introduces Prebiotic Cola Months After Poppi Acquisition
PepsiCo on Monday announced that it will launch a prebiotic cola under its namesake soda brand, starting this fall. Pepsi Prebiotic Cola comes just four months after the beverage giant announced its $1.95 billion acquisition of upstart Poppi. Soda consumption has broadly fallen over the past two decades in the U.S. But prebiotic sodas, fueled by Poppi and fellow newcomer Olipop, have won over health-conscious consumers over the past five years with their gut-health claims. That acquisition closed in May.
Prior to the deal, Pepsi had reportedly aimed to launch its own functional soda under its Soulboost brand, but canceled those plans. As demand for its drinks falls domestically, Pepsi is leaning into health trends like the protein and fiber crazes to attract customers. In the second quarter, the company’s North American beverage volume shrank 2%. Its namesake soda was one of the few bright spots, helped by the success of Pepsi Zero Sugar.
The World’s Best Scotch—According To The 2025 International Whisky Competition
Aultmore 25 Year Old Scotch won the IWC's top award for the second year, a shock given its rarity in the US. This $500 dram, crafted by 6-time "Master Blender of the Year" Stephanie Macleod, is part of the Cask Finish Collection. Its consistent win highlights its quality, hopefully increasing its limited US availability. Aultmore 25 Years Old 1st Fill Oloroso Finish earned the highest marks with an impressive showing of 95.10 points. Forbes says “It’s a belter of a dram, dispensing a harmonious medley of fresh fig aromas, a spiced pineapple palate and a lingering thread of brioche smothered in MÄnuka honey.”
The stunning thing here is that this marks the second year in a row that Aultmore 25 has taken home the top prize in the Scotch category. It would be an enviable feat for any brand, to be sure. But the achievement is even more remarkable when you consider that Aultmore remains a fairly esoteric label here in the US. If drinkers were more fully aware of its pedigree, they would probably be less inclined to sleep on its success. The 130-year-old distillery in the heart of Speyside is owned today by John Dewar and Sons (and its parent company, Bacardi). That means much of the 2.1 million liters per year pumping out of its pot stills is reserved for the enduringly popular Blended Scotch line. It also means that Dewar’s master blender, Stephanie Macleod is the one in charge of overseeing production here.